Answers · UK 2025/26
How are Enterprise Management Incentive (EMI) share options taxed in the UK?
EMI options give no income tax or NI on grant or exercise (if granted at market value). Only CGT at potentially 14% BADR rate applies on any eventual gain.
Full answer
EMI (Enterprise Management Incentive) options are approved by HMRC for qualifying companies (under £30m gross assets, under 250 employees). Options granted at market value: no income tax or NI on grant, no income tax or NI on exercise, only CGT on the difference between exercise price and sale price. If shares are held for 2+ years before sale AND BADR conditions are met, the CGT rate is 14% (from April 2025, rising to 18% from April 2026). If options are granted at a discount to market value, the discount is treated as income at exercise. The EMI option limit is £250,000 per employee and £3m in aggregate for the company. HMRC must be notified of the grant within 92 days.
This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.